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Fed officials flag possible further steps in Fed crisis response
Federal Reserve officials are deliberating over next steps in their response to the fallout from the coronavirus epidemic, with some urging a broad debate about how the central bank might help small and medium-sized businesses, policymakers said on Tuesday. “At this stage everything is on the table. … Work continues,” Atlanta Federal Reserve Bank President Raphael Bostic said in a phone interview with journalists, just hours after the Fed restarted a key lending program to ensure larger companies can get the short-term loans they often use to pay wages and buy supplies.
A possible next step, Bostic said, could be the resumption of other programs rolled out during the 2007 to 2009 financial crisis, such as the Term Auction Facility that broadened the ability of banks to borrow from the Fed.
Bostic said he hoped for a broader discussion about how the federal government “writ large” might help small businesses, perhaps with a program, likely outside the Fed, to offer assurances or guarantees for rent and lease payments so that a temporary cash crunch does not lead to a business getting evicted.
“These challenges are going to be acute and are going to come fast,” for restaurants, bars and other small firms that may be closed by government edict as a health measure or see their business collapse as their patrons practice “social distancing,” Bostic said. “This is something we need to think about and be creative.”
Discussions in Washington continued throughout the government on Tuesday, including a call by House of Representatives Speaker Nancy Pelosi with Fed Chair Jerome Powell. Pelosi, a Democrat, asked the central bank to also think how it might help local governments deal with the economic shock that is developing.
The Fed rolled out an extensive set of measures in recent days designed to lessen the economic damage from the epidemic, which Bostic said was meant to show that “maximum” stimulus will be provided until the crisis passes.
Fed officials on Tuesday began discussing their actions in more detail, urging banks to tap Fed facilities if needed and highlighting how uncertain the outlook remains.
“Come and get what you need to keep the funds flowing,” Philadelphia Federal Reserve President Patrick Harker said in an interview.
Minneapolis Federal Reserve President Neel Kashkari said on CNN International that his base case for the U.S. economy is a mild recession, but “many businesses are going to be under tremendous strain, probably laying off many of their workers, and so this is quickly going to become an economic crisis.”
https://www.reuters.com/article/us-health-coronavirus-fed-bostic/fed-officials-flag-possible-further-steps-in-fed-crisis-response-idUSKBN2143WN
Term Asset-Backed Securities Loan Facility (TALF)
Term Asset-Backed Securities Loan Facility, or TALF, was a program created by the U.S. Federal Reserve in November, 2008 to boost consumer spending in order to help jump-start the economy. This was accomplished through the issuance of asset-backed securities. The collateral for these securities was made up of auto loans, student loans, credit card loans, equipment loans, floor plan loans, insurance premium finance loans, loans guaranteed by the Small Business Administration, residential mortgage servicing advances, or commercial mortgage loans. Backing for these loans came from funds provided by the Federal Reserve Bank of New York.
https://www.investopedia.com/terms/t/talf.asp
So they are setting this up to start taking EVERYTHING ala 2008.
How China's chip industry defied the coronavirus lockdown: Beijing bent Wuhan quarantine rules in a high-stakes bid for tech self-sufficiency
March 18, 2020 04:00 JST
TAIPEI – Most high-speed trains have not stopped in Wuhan since Chinese authorities locked down the city on Jan. 23, in an attempt to control the outbreak of the novel coronavirus that originated there. Most, but not all. Some have kept special reserved carriages, occupied by experts heading into the middle of the quarantine zone – not to its clinics or hospitals, but to Yangtze Memory Technologies, China's most high-profile memory chip project. Beginning in February, Yangtze Memory sent cars to the station to pick up groups of staff, depositing them at a self-quarantine dormitory for a week before they were allowed to enter the main working area, sources close to the project told Nikkei.
These secret trips, which have not yet been reported, brought volunteer employees back to the center of the epidemic to relieve some 300 engineers who had been working on rotating shifts at the factory since the shutdown began. Many were young professionals under the age of 30, who were originally assigned to cover the Lunar New Year but then became stranded at the facility. For more than a month, they labored to keep the plant running. "They are banned from leaving the company campus and are under massive pressure. … Most of them work more than 10-12 hours a day and are on call all the time," said an industry source familiar with the matter. The government also lifted labor regulations to allow employees to work more than the mandatory cap of 36 hours overtime a month. In Hubei Province, where Wuhan is located, schools closed, trains stopped, and malls and supermarkets shut down. But the chipmaker stayed open, enabled by the local and central governments, which gave special dispensations to allow it to bring in materials and labor, and to ship finished goods out of the province to distribution centers in Shanghai. The company portrayed this as a heroic effort, and encouraged employees to submit stories about their efforts during the outbreak to the Chinese Communist Party, according to an internal note obtained by Nikkei, so that "those would later become great historical materials."
The Big Fund
The Chinese government has long harbored ambitions to build an independent technology supply chain to compete with that of the U.S., but its efforts have gathered pace since 2014. The previous year, former U.S. intelligence contractor Edward Snowden had gone public with a cache of documents revealing the extent of American surveillance programs around the world. That heightened a fear that geopolitical rivalries were going to play out through strategic technologies, and prompted China to re-examine its technological vulnerabilities.
Memory chips came high up the list. Components like NAND flash memory chips are ubiquitous in smartphones, computers and servers, as well as in the next generation of connected cars and "internet of things" devices. Six companies – Samsung Electronics, Kioxia, SK Hynix, Western Digital, Micron Technology and Intel – make up nearly 100% of the market. None of them are Chinese, meaning that to compete globally, China's national champions – Huawei Technologies, ZTE, Xiaomi, Alibaba Group Holding and Lenovo – rely on imported technology. Attempts by Chinese companies to gain access to U.S. technology through mergers and acquisitions have been repeatedly thwarted. In 2015, the state-backed tech conglomerate Tsinghua Unigroup tried to buy out Micron and take a stake in Western Digital, but both bids were blocked by the interagency Committee on Foreign Investment in the U.S. due to national security risks. Other Chinese attempts to buy chip-related companies such as Lattice Semiconductor and Aixtron fell apart due to U.S. government intervention. Chipmaker Broadcom's takeover bid of Qualcomm was also called off by the Trump administration over national security reasons in 2018.
rest at link. long
https://asia.nikkei.com/Spotlight/Cover-Story/How-China-s-chip-industry-defied-the-coronavirus-lockdown